GPS for your Money


Perhaps the most known term but yet the most undervalued tool in any financial strategies, may it be for a home, an organization or a country for that matter is the Budget.

Everyone has heard of it, a few know about it but most fail to use it. California State is a great testimony to the catastrophic failure of balancing the budget even with all of their so called accounting experts.

A budget serves just like a car dashboard with GPS for your money. It gives your money specific directions on where to go. It lets you know how much farther you are to your financial destination. How fast or slow you are in getting where you want to go and it gives you a summary of your current financial status which should always be considered when deciding on any big life changes or purchases.

Most do not give the time and effort in actually creating their personal or family budget for reasons that are as varied as the people themselves. Some are overwhelmed by the initial tediousness of actually listing down every single expense and income they have. While others see it as a futile effort since their income barely covers their expenses anyway. So, why bother listing the expenses down when the bills reminds them of what needs to get paid.

Having a budget is simply a must if one prefers to live debt free. Of course there are people that earn more than they can spend and are exempt from even needing to think about budgets. But for those who are still on their way to such luxury, a life without a budget; is simply unaffordable.

As your financial GPS, a well maintained budget tells you immediately how much money is left if there is any, for any other purchases. Let’s say you are saving for a down payment for a car or a house. A look at your monthly budget can quickly tell you if you have enough to go ahead with it or if you should put in more to the fund, in order to speed up the accumulation and get it sooner.

It can also be used as your Stop light. When one is in a dilemma between purchasing non-essential items or not. If the budget does not show that there is an allocated fund for such item then the answer is simply NO. That’s is your red light signal telling you to stop and not buy that item. A little crude and simplistic method, but it works.

I call it show me the money” principle. Taken from the Jerry Maguire movie of course. If the the budget does not show the Money then you should not buy it. It works well with the wife too. No need to argue or justify purchases. Just say, show me the money!

Try to actually sit down and write down your budget. You might be surprised, once sorted out, you might have more money than you think.


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